Bain Capital’s Korean casino takeover won’t harm Mohegan’s credit rating, Fitch says

The ratings agency has assigned a B rating to the Mohegan Tribal Gaming Authority.

South Korea.- Fitch Ratings has concluded that the credit rating of Mohegan Tribal Gaming Authority (MTGA) should not be significantly affected by Bain Capital taking control of the South Korean casino resort Mohegan Inspire. The ratings agency noted that there were no cross defaults and that MTGA is no longer involved with the Korean credit facility.

Fitch assigned MTGA a first-time B long-term rating with a stable outlook after MTGA announced plans to issue two senior secured notes each totalling US$600m, one due in 2030 and other due in 2031. The casino operator plans to secure a new senior credit facility of at least US$250m either before or at the same time as the bond issuance.

Bain Capital took operational control of Mohegan Inspire after MGE defaulted on US$275m in loans used to finance the integrated resort (IR). The casino held a soft opening on November 30, 2023 and a full opening last March. It has over 150 table games, 390 slot machines, and 160 electronic table games (ETG). It has a floor for VIP guests featuring a Guandong-style restaurant.

For the first quarter of the financial year 2024/2025, MGE posted net revenue of US$498.9m, up 17.3 per cent year-on-year. Group-wide EBITDA reached US$85.1m, a rise of 7.6 per cent. The company attributed the growth in revenue to a strong quarter at Mohegan Sun in the US and continued growth from Mohegan Digital. Mohegan Inspire posted net revenue of US$63.52m compared with US$5.1m a year earlier before the casino at the complex opened. The venue recorded negative adjusted EBITDA of US$4.19m, an improvement on the US$10.9m EBITDA loss recorded in the prior-year period.